AlterPolitics New Post

The Neoliberal Ways Of The World Bank May Be Numbered If Jeffrey Sachs Becomes Its President

by on Friday, March 9, 2012 at 11:19 am EDT in Politics, World

When World Bank President Robert Zoellick announced that he would step down at the end of his five-year term in June, calls were made for his successor to be selected based on merit this time, rather than on nationality, as has been the custom for the past 68 years.

Whereas the International Monetary Fund’s Managing Director has always been a European, the World Bank’s President has always been an American. Though the U.S. is indeed the institution’s biggest funder and largest shareholder, its finances are paid by taxpayers around the world.

The moment Zoellick made his announcement last January, the Obama Administration indicated it had every intention of inserting an American as the new President. At a briefing on Feb. 21 , State Dept. Spokesperson Victoria Nuland stated, “Our expectation is that we will nominate a strong American candidate and we will put our full backing behind that person.” 

After Nuland ruled out Secretary of State Hillary Clinton as a possible successor, several other top contenders’ names have been floated around.

These include Former Obama Economic Adviser and former U.S. Treasury Secretary Lawrence Summers, U.S. Ambassador to the U.N. Susan Rice (who has also been rumored to be Clinton’s likely replacement as Secretary of State), PepsiCo Inc CEO Indra Nooyi, and Sen. John Kerry (note: his spokesperson said he was not interested, and had never even been contacted about it).

If Rice does in fact have her eyes on State, this would leave Summers and Nooyi as two ‘short-listed’ contenders. The Chicago Tribune listed the pros and cons of Summers and Nooyi:

Lawrence Summers:

Sources within the World Bank and the Obama administration said that while Summers has excellent credentials, he also has political baggage.

While president of Harvard University, he created a firestorm by suggesting women may have a lower aptitude for science and engineering. He is also remembered for a memo he wrote in 1991 when he was the World Bank’s top economist that laid out the economic logic of dumping toxic waste in developing countries.

By selecting Summers, Obama “would have to use political capital” with his liberal base and women’s groups, the source with knowledge of the administration’s thinking said.

Indra Nooyi:

Nooyi, the Indian-born chief executive of PepsiCo, has been under pressure from investors for a stagnating stock price. She recently laid out a plan to turn around the company’s North American soft drink business and took responsibility for management missteps. PepsiCo spokesman Peter Land declined to comment on whether she would be interested in the World Bank job.

If Obama chose a woman, he would be breaking the mold for a job that has always been held by a white male, a move that could garner support from developing nations.

But as the White House vets its candidates, it is facing international pressure to democratize the selection process. The fastest emerging economies, including China, Russia, India, Brazil, and S. Africa have coalesced to end this 70 year old passport-as-determining-factor tradition.

They were so appalled at how Europe arrogantly moved to replace the IMF head last year with one of its own, despite pleas to open the process, that they have responded more forcefully this time with Zoellick’s announcement. They have every intention of nominating some stellar candidates of their own to fill the impending vacancy.

Well, one American Economist, Jeffrey Sachs, who is director of the Earth Institute at Columbia University and serves as Adviser to U.N. Secretary General Ban Ki-moon, has helped to make this a true contest. He has thrown his hat into the ring, albeit his nomination didn’t come from the U.S. He has been nominated by Kenya, Malaysia, Jordan, Namibia, Bhutan and East Timor.

And in stark contrast to outgoing President (Bush-appointee) Zoellick, who had been a former Managing Dir. of Goldman Sachs, Jeffrey Sachs considers ‘Neoliberal’ a dirty word (as demonstrated by his Tweeted response to one critic’s accusation):


Here is how he distinguishes himself from traditional World Bank Presidents:

Unlike previous World Bank presidents, I don’t come from Wall Street or U.S. politics. I am a practitioner of economic development, a scholar and a writer. My track record is to side with the poor and hungry, not with a corporate balance sheet or a government. Yet the solutions work for all — the poor, companies, governments and the rest of us — by creating a more prosperous, healthy and secure world.

Sachs has the full support of Congressman John Conyers (D-MI), who is circulating a letter on his behalf to President Obama. Current signatories include John Conyers, Hansen Clarke, Jesse Jackson, Jr., Barbara Lee, Zoe Lofgren, Jim McGovern, Lynn Woolsey, Raul Grijalva, Eleanor Holmes Norton, Keith Ellison, Robert Brady, Rubén Hinojosa, Peter DeFazio, Steve Cohen, Maxine Waters, and Bob Filner. 

Mark Weisbrot, in his piece yesterday in The Guardian (which I highly recommend reading), highlighted some of the World Bank’s disgraceful policies over the last 15 years. He then explains why Sachs is the right guy to help turn the institution around:

The bank could … play a positive role by increased financing of urgent development needs such as health, education, and sustainable agriculture. In these areas, Jeffrey Sachs has a proven track record over the past decade. He has played an important role in supporting the Global Fund to Fight Aids, Tuberculosis and Malaria, which has saved millions of lives in poor countries. His Millennium Villages project has also provided a significant positive example of how development aid can be used to boost agricultural productivity and health outcomes. This is an important refutation of the widespread cynicism that helps limit the financing of real, positive development aid.

Sachs has also been a strong advocate for debt cancellation in poor countries. His 2008 book Common Wealth provides one of the best overviews of the interrelated problems of climate change, development, poverty, population and health – as well as a set of concrete proposals for addressing them. This is clearly someone who has the knowledge, ideas, and experience to lead the bank in a different direction. … As Sachs noted last week:

“US officials have traditionally viewed the World Bank as an extension of United States foreign policy and commercial interests. … Many projects have catered to US corporate interests rather than to sustainable development.”

But Weisbrot believes ‘Sachs is facing an uphill battle,’ being an election year. Many of Obama’s biggest contributors happen to be the Wall Street banks and corporations that have millions at stake in the World Bank. They will obviously want another one of their Neoliberal bank cronies to man the top spot. 

World Bank officials will be accepting nominations for Zoellick’s successor until March 23rd.

WATCH CNN’s recent interview with Jeffrey Sachs:

TAKE ACTION: Ask your Congressperson to Sign John Conyers Letter Pressing Obama to Name Sachs to World Bank (The deadline to sign Conyers letter to Obama is COB Monday, March 12.)


Thought it only fair to post a quote from Naomi Klein, who in her book, The Shock Doctrine, critiqued Neoliberal policies that Sachs had overseen in places like Poland and Russia. She was asked in 2007, if she believed Sachs was merely re-branding his image, or had truly changed: 

A lot of people are under the impression that Jeffrey Sachs has renounced his past as a shock therapist and is doing penance now. But if you read The End of Poverty more closely he continues to defend these policies, but simply says there should be a greater cushion for the people at the bottom.

The real legacy of neoliberalism is the story of the income gap. It destroyed the tools that narrowed the gap between rich and poor. The very people who opened up this violent divide might now be saying that we have to do something for the people at the very bottom, but they still have nothing to say for the people in the middle who’ve lost everything.

This is really just a charity model. Jeffrey Sachs says he defines poverty as those whose lives are at risk, the people living on a dollar a day, the same people discussed in the Millennium Development Goals. Of course that needs to be addressed, but let us be clear that we’re talking here about noblesse oblige, that’s all.

Just thought I should put it out there, since I have a world of respect for Naomi Klein and her opinions on the matter.

With No Exit Polls, The “Why?” For Dem. Coakley’s Senate Defeat Gets Spun

by on Wednesday, January 20, 2010 at 3:44 pm EDT in Healthcare, Politics

One of the most vexing revelations to come from last night’s Senatorial contest in Massachusetts was the fact there were NO EXIT POLLS.  NONE!  Not a single news organization conducted exit polls to ascertain a “why?” for such a huge, significant upset.

Surely, the networks knew the significance of last night’s election before a single vote was cast, and they clearly saw Coakley’s sliding poll numbers since January 5, when Rasmussen released a survey showing Republican Scott Brown trailing Democrat Martha Coakley by only nine points.

Call me a cynic, but you just have to wonder if the absence of exit polls wasn’t somehow intentional.  Perhaps the beltway media establishment didn’t want to quantify the populist voter outrage which would likely incite a legislative turn to the Left, against entrenched interests.

By not conducting exit polling, the establishment accorded itself the opportunity to reframe the impending Democratic upset in the usual way: Obama needs to move further to the right to placate enraged Independents (whom they routinely misportray as nothing more than disaffected Republicans).

Ryan Grimm of the Huffington Post addressed the establishment’s reaction to last night’s Republican victory in Massachusetts as being focused entirely on the Independent voters; while largely ignoring the base:

With all the talk about “angry independents” deciding the special election in Massachusetts Tuesday night, the inclination among establishment Washington Democrats is to chase after them. Progressives, meanwhile, want the party to deliver on promises made during the campaign.

Not surprisingly, Democratic politicians are already indicating that they will likely shift rightward.  Barney Frank seemed to suggest to Rachel Maddow, in reaction to the upset, “that without support from at least some Republican senators, health care reform, at least in this iteration, wouldn’t happen.”  In other words, he interpreted this defeat as a need to appease the right — as if they haven’t been doing that all along.  That move would certainly help him to water down even further his current banking reform initiative (as would also be necessary to gain Republican votes).

Anthony Weiner “suggest[ed] on MSNBC that maybe it’d really be better to drop health care reform–and pivot to jobs.”

Digby points out that Chris Matthews, in reaction to Coakley’s defeat, has now joined the deficit-hawk choir:

The predicted reverberations are already being felt. Chris Matthews is already going on about deficits being the most important problem in the whole wide world and how his daughter is really worried about government spending and taxes.

And the Democrats are subsequently making it much more difficult to fix the economy by playing into this deficit propaganda themselves.

The usual conservative voices, as one would expect, are all too happy to capitalize on the absence of exit polls.

Here’s Michael Gerson at the Washington Post, suggesting that Obama’s “liberalism” has infuriated Independent voters:

It means that Rahm Emanuel’s “big bang” theory of legislative liberalism is the most foolish political strategy in recent memory. It means that spending political capital on health reform instead of economic recovery and growth was a dreadful error. It means that a crisis that Obama didn’t want to waste has largely been wasted. […]

There is only one explanation for this remarkable turn of events. Americans thought Obama was a moderate. He certainly sounded like one. But now he is attempting to remake one seventh of the economy in a quick march of party-line votes. In the process, he has alienated independents in large numbers — even in Massachusetts.

Did you get that?  According to Michael Gerson this isn’t about populist outrage from both the Left and Right; this is about Obama (who actually ran on a progressive populist platform) somehow misleading Independents into thinking he was more conservative than he really was.  To Gerson, it would seem Independents have suddenly awakened to discover that Obama and his “liberal” cohort Rahm Emanuel are governing as some kind of commie-liberals.

David Broder never once mentions populist outrage in his column; no talk of Wall Street bailouts while turning a blind eye to the plight of Americans; no mention of Health Insurance and Pharmaceutical Industry giveaways off the backs of hurting Americans.

First he mentions voter concerns about deficit spending, and then he describes just how Republican victor Scott Brown was able to capitalize on the current Health Care Reform bill before Congress:

This allowed Brown to argue that he would vote against the legislation pending in Washington, which by comparison looks more expensive and more bureaucratic and more partisan than the Massachusetts model.

Perhaps subtle to some, but the word “bureaucratic” is actually a lightening rod term within Conservative circles.  It conjures up images of an inefficient government run entity (i.e. the Republican stigmatization of a would-be public option — something which isn’t even part of the bill under consideration).  In reality, the Senate Bill is clearly a giveaway to the private “for profit” health insurance industry — a dream bill to a corporatist like Broder.

The only Democratic politicos Broder spoke to were the ones who seemed to parrot the White House talking points:

“They were critical of Coakley’s campaign, arguing that it was a serious miscalculation for her to break off campaigning and advertising after her easy victory in the primary.”

Like Gerson, Broder implies it is more about ideological differences; meaning the “liberal” Democratic Congress and President are imposing their will on a more “moderate” electorate, and it’s backfired.  Broder gives his readers two false choices to explain the Democratic upset: 1. voter repudiation of liberal initiatives (i.e. runaway spending and government ‘bureaucratic’ health care), or 2. a poorly run Coakley campaign (i.e. the White House talking points).  Yet he never mentions the visible outrage bubbling over from the left, as Obama continues to sell out the American people to serve his corporate masters.

The reality is President Obama has been governing from right of center since the moment he took office.  Liberals feel betrayed.  The Democratic base couldn’t be less energized — thanks to all of Obama’s broken promises, and his backdoor deals with entrenched interests.

Ryan Grimm contends that Independents and liberals have indicated they want essentially the same thing: CHANGE.

A review of surveys of independent and Democratic voters show that both want much the same thing: change. Both groups are deeply troubled by the state of the economy and angered that bailed-out Wall Street firms seem to be the only ones to have recovered from the crisis. […]

“If Scott Brown wins tonight, he’ll win because he became the change-oriented candidate,” Celinda Lake, pollster to losing Democratic candidate Martha Coakley, told HuffPost before the election results came in. “Voters are still voting for the change they voted for in 2008, but they want to see it. And right now they think they’ve got economic policies for Washington that are delivering more for banks than Main Street.”

Ezra Klein from the Washington Post perfectly sums up the frustration from the Left:

A Democratic Party that would abandon their central initiative this quickly isn’t a Democratic Party that deserves to hold power. If they don’t believe in the importance of their policies, why should anyone who’s skeptical change their mind? If they’re not interested in actually passing their agenda, why should voters who agree with Democrats on the issues work to elect them? A commitment provisional on Ted Kennedy not dying and Martha Coakley not running a terrible campaign is not much of a commitment at all.

Joe Trippi, a longtime party strategist and high-ranking official on the Howard Dean and John Edwards campaigns told the Huffington Post:

“This needs to be a wake up call that people are still demanding change.  I don’t think it is ideological, I don’t think it is left versus right. I think it is outsider versus insider. It is the new way versus people doing it the old way. That is still the carryover from 2008. And whether the Obama administration recognizes that is important. This is a wake up call that they can’t play the inside game.”

Glenn Greenwald weighs in on the establishment’s effort to reframe Coakley’s defeat as voter repudiation of the Left:

The very idea that an administration run by Barack Obama and Rahm Emanuel and staffed with centrists, Wall Street mavens, and former Bush officials — and a Congress beholden to Blue Dogs and Lieberdems — has been captive “to the Left” is so patently false that everyone should be too embarrassed to utter it. For better or worse, the Democratic strategy has long been and still is to steer clear of their leftist base and instead govern as “pragmatists” and centrists — which means keeping the permanent Washington factions pleased. That strategy may or not be politically shrewd, but it is just a fact that the dreaded “Left” has gotten very little of what it wanted the entire year.

Senator John Kerry — the quintessential Washington ‘insider’ — has wisely calculated the necessity in addressing populist angst, by attributing it to Coakley’s defeat:

I didn’t need any reminders, but this election encapsulated what was clear in 2006 and 2008 and remains clear today: Americans are angry. They’re mad at Washington and they’re mad at Wall Street. They’ve seen millions of jobs lost and been left no choice but to bail out those responsible. They’re tired of insurance companies that charge exorbitant premiums but don’t deliver decent coverage when they need it. They’re fed up with sending billions of dollars a day overseas for foreign oil. They hate knowing that they pay taxes while powerful interests evade taxes and hide money overseas in Cayman Island bank accounts. And they expect all of us, Democrat or Republican, to fight for them.

So what should those on the Left take away from these dueling-message efforts?  In the future, if Progressives intend to send a ‘resounding’ message by abandoning Democratic candidates, they’d be well served to at least hire an independent polling company to conduct exit polls that accurately quantify the “why?” for voter behavior.

If exit polls aren’t there to capture the true underlying motivation of the voters, then the beltway establishment will gladly define it for them.


Thanks to cbsunglass at FireDogLake for pointing out a newly released Research 2000 Massachusetts Poll.

Though not an exit poll, it reveals exactly what we hoped to show. Fascinating how this has been largely overlooked by much of the press all day.

Here are some of the findings of that poll:

  • 95% of voters said the economy was important or very important when it came to deciding their vote.
  • 53% of Obama voters who voted for Brown and 56% of Obama voters who did not vote in the Massachusetts election said that Democrats enacting tighter restrictions on Wall Street would make them more likely to vote Democratic in the 2010 elections.
  • 51% of voters who voted for Obama in 2008 but Brown in 2010 said that Democratic policies were doing more to help Wall Street than Main Street.
  • Nearly half (49%) of Obama voters who voted for Brown support the Senate health care bill or think it does not go far enough. Only 11% think the legislation goes too far.